USA Financial Extortion

Individuals (famous economists), and organizations that are profiting from the present oligarchic system cannot be too critical against what feeds them. One has to read beyond the mellifluous lines.

Here is The Economist, June 28, 2014:

“Share and share alike… America should also embrace the OECD’s efforts, already backed by more than 50 countries, to create a truly multilateral system in which tax information on residents’ accounts and certain investments is shared annually. For that to work, America would need to hand over data similar to those which it demands from others—something it has hitherto appeared reluctant to do. The financial superpower looks ever more a regulatory bully, setting rules it ignores itself.

Bullies Kill, Vultures Feed, Justice The Old Fashion Way

Bullies Kill, Vultures Feed, Justice The Old Fashion Way

Setting rules for others one ignores for oneself is the essence of viciousness.

The financial superpower looks ever more a regulatory bully?

The USA is a financial bully, and it started in 1944, when the USA tried to bully Lord Keynes himself (head of the currency commission at Bretton-Woods), into accepting the Dollar of the USA as the world’s reserve currency.

The fact that it started so long ago means that the bully’s institutions have evolved accordingly. A particular case if American justice, which finds American violence to be just: the case of the vulture funds is exemplary. Whoever stands in the way of American vultures is unjust.

Keynes wanted to use the International Monetary Fund to create “Drawing Rights” as needed, a solution Dominique Strauss-Kahn implemented to the tune of 450 billion dollars until his fateful encounter with the maid from hell, taken super seriously by New York “Justice” (until she proposed so many tricks to the officers in charge of “protecting” her, that, well, it was embarrassing, even for New York “Justice”).

Keynes resisted totally, so the government of the USA forged the documents that made the USA into the one and only financial superpower. When Saddam Hussein begged to differ, and started to use Euros, he was hanged. So the BNP executives, who have not been executed yet, ought not to complain too much, as The Economist astutely points out, somewhere else.

What is The Economist alluding to above? “… hand over data similar to those which it demands from others.” To the fact that the USA is the world’s largest tax haven for global plutocrats, while busy destroying all other tax havens. The destruction of Swiss banks and bankers is exemplary that way.

In other words, the USA sucks up capital from all over the world, by stealing other countries’ taxes (as it provides plutocrats, worldwide, to escape taxation, thanks to… Delaware).

Says The Economist in: “Tax havens, The missing $20 trillion How to stop companies and people dodging tax, in Delaware as well as Grand Cayman”: a lower rate on a broader base, combined with vigilance by the tax authorities, would be more efficient and would probably raise more revenue: America, whose companies face one of the rich world’s highest corporate-tax rates on their worldwide income, also has some of the most energetic tax-avoiders.

These reforms would not be easy. Governments that try to lower corporate tax rates will be accused of caving in to blackmailing capitalists. Financial centres and incorporation hubs, from the City of London to Delaware, will fight any attempt to tighten their rules. BUT IF POLITICIANS REALLY WANT TO TAX THE MISSING $20 TRILLION, THAT’S WHERE THEY SHOULD START.”

From the horse’s mouth: to tax the missing $20 trillion, start from London to Delaware… Exactly what I have been saying for years. The global financial exploitative mess is part of an Anglo-American imperial situation.

I have condemned the way “judicial” authorities in New York siding with the financial vultures therein. The Economist now agrees with me, and goes somewhat further, as it alleges state corruption. Here is an extensive extract from:

BNP Paribas in the dock: No way to treat a criminal. The French bank deserved a clobbering, but America’s legal system looks like an extortion racket.

BNP argues that it broke no European laws… That is true enough, to Europe’s shame… It is also true that the underlying transactions had nothing to do with America, but because they were denominated in dollars they had to be cleared in New York, which provided America’s lawmen with a toehold.

But the guilt of a suspect and the justice of a cause do not make a tribunal fair. And America’s system for pursuing errant banks, especially foreign ones, is anything but fair… BNP had little choice but to settle. Defeat in court might have led to the loss of its American banking licence—a death sentence for a big international bank. America’s prosecutors can also wield the threat of criminal charges against individual bankers.

Bank against the wall

Not only were BNP’s tormentors, such as Benjamin Lawsky, New York’s politically ambitious banking regulator, able more or less to dictate their terms, they also had an incentive to make the fine as big as possible because the agencies involved divvied up much of it among themselves. Mr Lawsky’s outfit gets $2 billion, four times its annual budget, which it will triumphantly deposit in New York state’s depleted coffers.

There are no meaningful checks on this process, let alone a plausible procedure for BNP to appeal. Bank bosses cannot even publicly criticise deals they agree to under extreme duress. No precedent is set and no guidance provided as to the limits of the law and the proportionality of the punishment.

So even if BNP fully deserves its punishment, the legal system that meted it out is closer to an extortion racket than justice. France’s economy minister, Arnaud Montebourg, has compared America’s pursuit of BNP to “economic warfare”. In other words, a bank that catered to mass murderers has had some success in portraying itself as a victim. Any process that can make BNP’s dealings with Sudan look anything less than shameful must be very flawed indeed.”

“Catered to mass murderers”? Is that not the story of the invasion of Iraq by the USA? Did BNP invade Sudan? Is the USA pursuing the invaders of Iraq?

No, the USA is using imperial might in ways very similar to Putin. (Putin also has laws and judges and Congress on his side, nota bene.)

Two months ago Argentina reached a settlement with the Paris Club, a group of government creditors.

On June 16th the Supreme Court of the United States decided twice in favor of NML Capital, a “vulture” fund (and subsidiary of hedge fund Elliott Management) that snatched dirt cheap bonds after Argentina’s 2001 default. The fund and its plutocratic owners have since pursued the country for the payment of all principal plus outstanding interest in US courts. For at least 1.6 billion dollars.

The ability of struggling countries to restructure their debts has been dented. Hold-outs everywhere have greater incentive to litigate; creditors who might accept exchange offers could see them gulped down by vultures, catered to by USA judges.

Those who play with fire to burn others may find where the concept of “backfiring” comes from.

Patrice Ayme’

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17 Responses to “USA Financial Extortion”

  1. gmax Says:

    Extortion instead of invasion and extermination: change we can believe in. Plutocracy we can trust. I am happy to have voted for Obama and being a complete fool: this way I suffer less thx to my obvious mental retardation and general naivety

  2. Paul Handover Says:

    Read your essay, Patrice, a short while ago. Then have been sitting staring at the tablet screen unable to find the words to write a reply. All that comes to me, pathetically repeated frequently to you and others, is that silly joke: Why has this planet never been visited by aliens? Answer: Because passing aliens haven’t seen any signs of intelligent life!

    It would be funny if it weren’t so close to the bone!

    • Patrice Ayme Says:

      Well, Paul, I am happy to see you speechless. It’s indeed astounding that The Economist has been writing, black on white, things that many would have been labelled “Marxist” and “extreme” up to a very recent time

      I am NOT Marxist, especially since Marx, like Thomas Picketty ignore the banking system all too much; actually I have an extract coming out on that today. Actually, it’s very intelligent for the criminals to pretend they are doing justice, as they are just engaging in extortion. This is exactly the business of the Godfather (in the movie, or in reality).

      Unfortunately, intelligence gives predators an edge. A warning in the stars…
      PA

  3. Kevin Berger Says:

    Relevant?

    http://www.bloomberg.com/news/2014-07-06/france-says-boosting-use-of-euro-is-issue-of-global-balance-.html

    http://www.bloomberg.com/news/2014-07-05/total-s-de-margerie-sees-no-need-for-dollars-in-oil-purchases.html

    • Patrice Ayme Says:

      Yes, of course, Kevin! Very relevant! Thanks for the links! The solution is to print Euros, LOTS of Euros.

      The obstacle here has been old decrepit Germans (OK, not the young descendants of immigrants playing in Brazil!), who cling to their Euros like avaricious fogies. Germany is having a ride on luxury cars and machine tools (and they are indeed the best). But, ultimately, it’s more about cutting edge tech, and it’s where France, say is at an advantage… And of course the USA, that is busy, thanks to Silicon Valley, GE, and Boeing, STEALING the highest tech it can find anywhere (SV types are the first ones to acknowledge in private conversations, that, although their minions are best for code, much of the rest is stolen in Europe)…

      Euroskeptics, in that light, are just a FIFTH Column for Wall Street, including our esteemed collaborator Chris Snuggs… They want to stay on the dollars, something they do not have, so they can be slaves to New York, because that’s where they find all the glory they want.

      • Dominique Deux Says:

        “Euroskeptics, in that light, are just a FIFTH Column for Wall Street”

        I’ve been saying that for years, but why “in that light”? Every single action of the Euroskeptics, starting with their 2005 triumph, has been in direct support of Wall Street and the City. Even though the latter makes noises to the contrary, its brand of Europe is exactly what Euroskeptics claim to want – ineffective and vulnerable. And I would love to have a close look at their funding.

        • Patrice Ayme Says:

          Their funding? Probably CIA and the like, as when in the 1950s the top French journalist, including the star at Paris match, were on the CIA roll…

          Chris Snuggs, blessed be his anti-hero, I mean anti-Euro soul, is always repeating the same 15 slogans, none of them reflecting understanding of the situation. I put the ebauch of an answer on my overflow site.

          Chris says we never voted for a European empire (so what? the UK is a mini empire, so are France and Deutschland). By not choosing Europe, he choses the alternative, such as Russia and the USA and China, or Google all of which are evil empires! These people remind me of the fascists of WWII who chose Nazi Germany. Beyond all the idiotic reasons they gave, fundamental was the idea of submitting to a more masterful, more cruel and rougher master. It’s fundamentally a masochistic impulse.

    • Patrice Ayme Says:

      The problem of the Greco-Roman empire is that Rome, or more exactly, Roman plutocracy, smothered social, democratic, republican City-States. That was rendered possible by the fragmentation of Greece (itself engineered by Macedonian plutocrats around 320 BCE, and earlier because of the Peloponnesian War).

      If Europe stays fragmented, it will be smothered. That’s why it’s encouraging that Putin talked to the Ukrainian, German and French leaders, a week ago. He seems to be dropping the separatists and Russian special forces in Ukraine. In other words, Putin seems to regain enough sanity to be able to recede from the abyss.

  4. Kevin Berger Says:

    And while I’m at it, an emotional, knee-jerk reaction to France’s voluntary servitude… problème, je n’ai pas les moyens de mettre des mots sur ce ressenti et cette aigreur. Solution, aller au plus simple, et recopier deux inconnus, qui eux y parviennent, en tous cas mieux que moi.

    Bruno D— Bonjour. A mon humble avis, cet avion qui est un échec technique, industriel et financier se vendra très bien. Contrairement à un avion national bien connu qui synthétise techniquement, financièrement (le Rafale n’a dépassé son enveloppe budgétaire que de 2.5% depuis la date de sa conception !) et industriellement tout ce que le F-35 a cherché à accumuler. La pseudo furtivité en moins. Et celle ci étant un surcoût de design qui peut faire l’objet d’une obsolescence technologique à tout moment. Si elle n’est pas déjà obsolète (lire à ce sujet les critiques de certains ingénieurs américains, dont le chef de projet du F16 en son temps, sur la longueur d’onde des radars de fabrication russe qui rendrait cette furtivité de toute façon caduque).
    Les Américains ont développé une soft power qui nous dessert. Nous sommes ringardisés en pays de carte postale, vieillot, dépassé et, concernant l’industrie d’armement, à moins de solides amitiés avec certains dirigeants, de “piece of crap” innefficaces (un reste une conséquence de la propagande de l’ignoble rat Goebbels dont se servent habilement d’ailleurs, et aujourd’hui, nos chers amis d’outre Rhin).
    De toute façon, pour en revenir au F35, il est trop tard en Europe pour revenir en arrière. Les fonds engagés et dépensés empêchent les pays acquéreurs de revenir en arrière.
    Les Britanniques qui y sont le splus engagés, ont pensé à un moment, vers 2006/2007, à changer leur fusil d’épaule, mais trop de centaines de millions avaient déjà été dépensés. En France, des experts de la langue de bois, mais qui ne sont pas des experts de la chose technique militaire, cassent du Dassault à longueur d’articles en lignes. Et sont vraisemblalement au mieux des idiots utiles, au pire des agents de la propagande militaro-industrielle américaine. Et je penche malheureusement pour eux, pour la première hypothèse… Pour vendre des armes il faut être crédible. Et nous ne le sommes plus. Les Américains, par contre le sont toujours et plus que jamais. C’est ça qui est vendeur. L’image de marque. Les Américains ont débarqués à Omaha Beach et ont su le vendre. les Français ont résisté sublimement à Verdun, mais n’y retse collée que l’image de quelques déserteurs et beaux parleurs. Les Allemands ont perdu la guerre mais leurs “wunderwaffen” et leur génie assassin sont encore dans tous les esprits. Ils sont “crédibles”. Tout le monde a oublié ce que Billote à Stonne pourtant en 1940, a fait tout seul derrière l’acier français à l’acier allemand. Si tant est que quelqu’un l’a rappelé un jour. Notre image, c’est parfums, champagnes et fromages (comme aime le rappeler la délicieuse Angela Merkel).
    Les Américains, eux, sont allés sur la lune.
    C’est la différence. On nous affuble une image désuète et ringarde et nous nous y complaisons. Pour le monde, nous ne sommes plus qu’un pays de culture intermittente… Cet avion donc, qui est un véritable scandale technique, financier et industriel se vendra très bien. Et tant pis pour ses acquéreurs si ça cogne pour de vrai un jour.
    Hier, à 12:43 · J’aime · 4

    Uriel F—- la France est ringardisée car elle l’accepte… Dans certains pays elle représente encore quelque chose, mais elle se complet à leur tourner le dos, pour complaire à ceux qui la méprisent… Une sorte de masochisme géostratégique assez intéressant. Le seul cas ou un état n’a pas des intérêts mais des sentiments, une sorte d’exception qui confirme la règle clausewitzienne.
    Après on ne peut plus d’accord avec le Soft power mais aussi couplé à une haine de sois (merci BHL and co…) et un apprentissage orienté de l’histoire…: en 45 pour une majorité de Français les héros de la seconde guerre étaient les russes, quelques décennies plus tard limite les français ne savent plus que ce protagoniste était présent…
    Hier, à 13:08 · Modifié · J’aime · 6

    • Patrice Ayme Says:

      It’s very true that the French themselves are causing a lot of the problems of reputation affecting France.

      Already Americans are saying that the French president was indicted, and no American president ever was.

      “Immer correct”, as the Nazis used to say after occupying France!

      France has too many civil servants (by far). As an amusing aside, French civil servants just tried to prevent me to go to France, right now, for administrative reasons. Finally they gave me a piece of paper which may, or may not work, and I had to pay for it. I will know better at the airport(s) in two days.

      French TV speaks too much about “haute couture”, cheese, wine, etc. Big difference with German TV, which is more science and technology (although the French TV is, overall, more intellectual).

      At this point, Europe is supposed to amplify the French Republic, but there is too much sabotage from the Wall Street agents in Britain. Those ought to be jettisoned.

      The F35 is a complete failure in ALL ways. That plane does strictly NOTHING well. NOTHING. The new British carriers were initially supposed to be equipped with Rafales.

      OK, come to think of it, the only thing the F35 could do was to put it on Mistral-like carrier (small carriers, that is). And, indeed, that’s the plan. But it will work well only against pirates, not against a major power.

      Brazil got persuaded to purchased the USA-Sweden Grippen… Which the Swiss People rightly rejected in a referendum.

      Normal people in the street feel all these debates have nothing to do with them. But it’s exactly the opposite. Although I am a fanatical ecologist, second to none, the anti-GMO terrorists in Europe ought to have been severely jailed, especially when they attack purely scientific studies and scientists.

      The anti-GMO activity in Europe has just made Monsanto a European OVERLORD.

      Overlord, indeed: that was the whole idea of World War Two. Bait the Nazis, and then switch into punishing them, and all of Europe: the Americans bombed out French ports (or Saint Malo) well after that had any plausible military utility. Except if one recognized the USA was in full economic war against Europe in general.

      So here in the USA one hears about the terrible subjugation of the Jews by the French… Something impossible to swallow in a family of just who suffered deaths at the hands of fascists.
      PA

  5. S Morrison Says:

    Facts about Paul Singer’s vulture fund Elliot Management– the main “creditor” in this Supreme Court case,having bought up lots of Argentine debt cheap after default.
    Fact: Singer is notorious for pressing suits against the poorest countries, like Congo-Brazzaville. He cares nothing about poverty or social disruption.
    Fact: Singer is a philanthropist who gives to right-wing pro-war foundations, the Republican party, and … LGBT groups. He gave the Human Rights Campaign $1.5 million to support gay rights internationally …
    Fact: Argentina, the target of his extortion this time, has some of the most progressive LGBT rights laws and policies anywhere in the world. Yet that doesn’t prevent philanthropist Singer from going after their economy, while US LGBT groups don’t protest!
    More on the contradictions of Singer’s vulture philanthropy? Read
    http://paper-bird.net/2013/11/04/hrc-and-the-vulture-fund-making-third-world-poverty-pay-for-lgbt-rights/
    and
    http://paper-bird.net/2014/06/24/vultures-over-iran/

    • Patrice Ayme Says:

      Thanks S Morrison! I appreciate all the information and links.

      Contradictions are useful to baffle critics. Surprise is more than half the battle. Contradictory ideas, sound, and facts act as smoke screens. That’s why Hitler claimed to be all about peace and minority rights (before September 1939).

      The way to go through the morass is to go after the worst facts. If BNP Switzerland really helped Sudan to the tune of six billion, and that enabled genocide in Darfur, then the individual responsible ought to be prosecuted, and do time behind bars, and have their assets seized.

      In the case of Singer, if he makes it impossible for emerging countries to get financed, he ought also to be prosecuted. Everybody knows this is risky business, and returns are excellent, except when the principal does not return. The vultures are sabotaging that system.

      BTW, Russia forgave today Cuba’s debt.
      PA

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    […] of course deserved his punishment: he drew for hundreds of billions of SDR. DSK was then ripe for retaliation, extortion, vulture justice. See how it all started, from that well known left wing propaganda outfit, CNN, which wrote in […]

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